So you want to sell your wine or spirit in the United States?
Updated: Jun 11, 2021
If you want to export your product, this is what you need to know before you begin.
Opportunity: born in the USA?
The United States has an overabundance of wines and spirits. New York State distributors alone have over 85,000 wine SKUs and over 15,000 spirit SKUs available for purchase by retailers, restaurants, and bars. Understanding that these numbers are themselves numerators over much larger denominators paints a bleak picture for any brand hoping to find the US a welcoming market. Opportunity exists, but overcrowding means that it is not easy to come by. If your excitement for entering the US market isn’t tempered by some worry, then you’ve greatly underestimated how competitive a field it is.
Everyone believes their wine or spirit has a home in the US; whether that house is a hovel or mansion is greatly dependent on the due diligence undertaken prior to export. Here are four things to consider before cold calling the portfolio manager you’ve never met before or emailing firstname.lastname@example.org.
· Make your first time special. Your first visit to the United States shouldn’t be to pitch your brand to an importer. Your first visit to the US shouldn’t be to show your products off at a trade show or at a general sales meeting. Your first visit to the United States should be to learn about the country and what you’re getting yourself into. You’ll quickly discover that you’re not dealing with one country, you’re running fifty states. That means fifty different sets of regulations and fifty different ways of doing business. When you visit, make sure to visit multiple states.1 Speak with restaurants and retailers. Unburdened by the need to push your product, learn as much as you can about what the market wants by reading lists, reading shelves, and reading people. Will this be time-consuming and expensive? Yes, but not more so than entering this country unprepared.
· Do your homework. Read an article. Read a book. Talk to that winery down the road that’s already been in the United States for a decade. What hurdles did they and do they face? Know that most of what they tell you will be true, but that some of it will be irrelevant because the market has matured since they entered it.2 Remember that your importer will be able to spend more time marketing and selling your product if they don’t have to explain facts to you that can be easily researched online or in discussion with colleagues. This includes understanding how pricing works. You should be telling your importer where your bottle will be priced—not the other way around—and how they can make better than average margins from it.
· The best importer isn’t always the first one that wants you. It takes patience to do things right including finding a partner that has a long history of paying their bills on time. When your biggest hurdle is securing an importer, it will be particularly tempting to sign on with the first one that shows interest in your brand. Know this: a bad importer is worse than no importer at all. A wine or spirit that fumbles in the market because of poor importer can seldom recover quickly. A useful rule of thumb is that you should be proud to represented among the other quality wines and spirits in their portfolio. If you wouldn’t serve some of their other products to your own friends and family, why would you let them represent you abroad?
· Don’t be a noob.3 Know the unspoken rules as well as the written, yet arcane ones. Don’t cold call or email a prospective importer in October or November when they’re likely their busiest. Don’t try to push a spirit in a 500ml bottle when its size format means it can’t be legally imported into the United States. In short, try to avoid rookie mistakes even though you’re a rookie.
1 I’d recommend visiting as many as possible from this list: New York, New Jersey, Pennsylvania, Illinois, California, Florida, Texas, Nevada, and Washington. These states will give you a taste of the diversity you’ll encounter with regard to demographics, regulations, taxes, and distributors. All of these are states that require you visit more than just one metropolitan area. New York is not just New York City and California is not just Los Angeles.
2 And because we’re still in the midst of a pandemic.
3 Or a newb or a N00b or any of the other alternative spellings of the word.